Gas Price Hike: Refinery Repair A Month or More Away

[Jimaz]

In case anyone was wondering what caused the recent price hike, this is one of those rare cases where it's not a mystery.

How 1 Indiana refinery drives up Michigan gas prices

[The problem] occurred this past Saturday, Aug. 8, at BP's refinery in Whiting, Ind., where its largest crude distillation unit — which begins the first step in processing oil — suffered an issue and capacity fell by more than 50 percent....

"Though BP is partially down, they're not making money when they're not selling gasoline. They're losing money."

Reuters reports repairs could take a month or more....

"Because crude oil has been so cheap, refineries have been incentivized to keep producing," [Patrick DeHaan, a GasBuddy senior petroleum analyst,] said. "This is not a time when refineries are deliberately slowing down."

I read somewhere else that it was an unexpected problem with leaking pipes in the initial unit that feeds the rest of the operations at Whiting.

[Ray1936]

If you believe what the oil companies tell you......well, never mind. Anyway, gas in Las Vegas has been around 3.30 all summer, and thirty-fourty cents higher in CA.

[Dan Wesson]

This ain't the first time gas has got close to $2 only to shoot up to $3 this summer. Then it takes a good while to come close to $2 then back up it goes. Do I see a pattern? You're darn tootin' I do.

I have witnessed that saw tooth pattern go up and down 50 to 75 cents for years now.

[Hermod]

This ain't the first time gas has got close to $2 only to shoot up to $3 this summer. Then it takes a good while to come close to $2 then back up it goes. Do I see a pattern? You're darn tootin' I do.

I have witnessed that saw tooth pattern go up and down 50 to 75 cents for years now.

OK, gallon of cheap leaded regular in 1955 was $0.22 a gallon. I just filled up with more expensive unleaded regular at $2.52 a gallon [[more expensive to refine).

In 1955, I could mail a 1st class letter for three cents and now it is 40-plus cents.

Who is ripping us off, the oil sheiks or the postal unions?

[Gpwrangler]

OK, gallon of cheap leaded regular in 1955 was $0.22 a gallon. I just filled up with more expensive unleaded regular at $2.52 a gallon [[more expensive to refine).

In 1955, I could mail a 1st class letter for three cents and now it is 40-plus cents.

Who is ripping us off, the oil sheiks or the postal unions?

Yeah but what was hourly wage back then? When gas was $.55/gal I was making $4 per hour.

If people used less when it hit $3 it would always be $2. But we use as much at $5/gal as we do at $2/gal. Question is, why does it go back down at all?

[Dan Wesson]

OK, gallon of cheap leaded regular in 1955 was $0.22 a gallon. I just filled up with more expensive unleaded regular at $2.52 a gallon [[more expensive to refine).

In 1955, I could mail a 1st class letter for three cents and now it is 40-plus cents.

Who is ripping us off, the oil sheiks or the postal unions?

The Federal Reserve and their policy of 2% or more inflation a year which deflates your purchasing power.

[emu steve]

OK, gallon of cheap leaded regular in 1955 was $0.22 a gallon. I just filled up with more expensive unleaded regular at $2.52 a gallon [[more expensive to refine).

In 1955, I could mail a 1st class letter for three cents and now it is 40-plus cents.

Who is ripping us off, the oil sheiks or the postal unions?

Neither? I'll answer the USPS below.

Curious what someone at McDonalds made in 1955 [[isn't that about when McDonalds started???)?

Ten years later [[say 1965) someone working at Fords in Dearborn made THREE bucks an hour.

So everything [[e.g., prices, wages, etc.) probably went up say 10 times [[give or take) 50 or 60 years ago.

So if gas was 22 cents 60 years ago and $2.20 today [[or will be in the next week or so), "What's the problem?"

Relax and by Labor Day [[or the week after) $2 gas will be back. Enjoy. Fill up. Drive to a college FB game in Kalamazoo or Ypsilanti or wherever... [[MSU opens at WMU).

Inflation happens... As far as USPS [[and schools), both are LABOR INTENSIVE employers. Both utilize domestic labor and don't benefit [[like computer parts or auto parts) from dirt cheap labor in China, Mexico, etc.

Dirt cheap things like all of these PCs, HD TVs, tablets, smart phones, etc. etc. are possible because there are tremendous cost savings on foreign labor.

We don't have $400 40" HD TVs because the foreign laborers are making 20 - 30 dollars an hour. A buck or two, max?

Think back 25 or 30 years about the price of PCs. Thirty years ago folks paid, I believe, $1,500 for a bare bones IBM PC. Equivalent of say 5K in today's dollars. American made with domestic labor and as expensive as hell.

[Hermod]

If you believe what the oil companies tell you......well, never mind. Anyway, gas in Las Vegas has been around 3.30 all summer, and thirty-fourty cents higher in CA.

Ray, California deserves it.

[Ray1936]

Ray, California deserves it.

That part is true. Alas, most of our gas in Nevada comes from the People's Republic.

[313WX]

Before these so-called refinery issues popped up, I heard the reason for the high prices was because the oil companies are using a special blend for the Summer, which is more expensive to process.

If you all recall back in January, when the price of oil had fallen below $43/barrel, the price of gas was about $1.70 [[nearly $1 cheaper).

[softailrider]

I hate to bring this up but if you want to beat them at their own game 2015 Toyota Prius are selling for 20200.00 plus tax. That's like 5K off msrp. I don't want one but it's tempting, they do get close to 50 MPG which is pretty damm good.

[Lowell]

These price spikes amuse me. One would thing that all the gasoline in all the underground tanks in the all the gas station in the metro was suddenly delivered today with the station owners suddenly having to pay 50 cents more per gallon. What a nice little 20% bonanza.

[Gpwrangler]

These price spikes amuse me. One would thing that all the gasoline in all the underground tanks in the all the gas station in the metro was suddenly delivered today with the station owners suddenly having to pay 50 cents more per gallon. What a nice little 20% bonanza.

Commodity prices can go up or down with the product already in inventory.

[mikeg19]

Commodity prices can go up or down with the product already in inventory.

Which is ridiculous to think about, but 100% correct. I think it's just frustrating to everyone when this happens because we all know that the price will jump $0.50 overnight, but it's going to take 6 months for it to come back down. If it worked both ways, such a when the refinery is fixed, gas came back down overnight, I think we might not be as pissed.

[Dan Wesson]

Which is ridiculous to think about, but 100% correct. I think it's just frustrating to everyone when this happens because we all know that the price will jump $0.50 overnight, but it's going to take 6 months for it to come back down. If it worked both ways, such a when the refinery is fixed, gas came back down overnight, I think we might not be as pissed.

Yep, what your basically seeing is this...



This way gas retailers can't be accused of fixing a price and they get their average price up there.

[emu steve]

Commodity prices can go up or down with the product already in inventory.

Commodity prices are like stocks [[or tulips centuries ago), they can go up, down, sideways, etc. based on the irrational actions of those speculating in them.

Or like housing, if the prices are too high or too low they will eventually find the 'correct' level. Ditto stocks.

This will happen with gasoline prices. Once the refinery is running normally again, there will be a glut of gasoline and prices will decline. And then the market will find equilibrium once secondary gasoline sources fade away.

[Dan Wesson]

Commodity prices are like stocks [[or tulips centuries ago), they can go up, down, sideways, etc. based on the irrational actions of those speculating in them.

Or like housing, if the prices are too high or too low they will eventually find the 'correct' level. Ditto stocks.

This will happen with gasoline prices. Once the refinery is running normally again, there will be a glut of gasoline and prices will decline. And then the market will find equilibrium once secondary gasoline sources fade away.

I used to believe that. But, since 2008, my eyes were opened concerning the manipulation of markets and the tools with which it is done.

p.s. and still learning each and every week the depth of manipulation legal and illegal, of manipulations that maybe legitimized by lobbying Congress but are morally bankrupt.

[Gpwrangler]

I used to believe that. But, since 2008, my eyes were opened concerning the manipulation of markets and the tools with which it is done.

p.s. and still learning each and every week the depth of manipulation legal and illegal, of manipulation that maybe legitimized but are morally bankrupt.

Speaking of market manipulation did you notice how we all car pooled when it hit $4?

[Smirnoff]

Pure BS....where is Trump on this one [[gas companies fleecing americans)?

[Cincinnati_Kid]

Pure BS....where is Trump on this one [[gas companies fleecing americans)?

I hope that clown Trump buries himself in a hole, and stays there until after the election.

[401don]

Well over here in Canada we have a plan. We let American oil companies dig out OUR oil, send it to the U.S. for refining, then we buy it back at world prices in U.S. dollars and pay 50% more than Americans at the pump. Pretty smart eh!

[Smirnoff]

Well over here in Canada we have a plan. We let American oil companies dig out OUR oil, send it to the U.S. for refining, then we buy it back at world prices in U.S. dollars and pay 50% more than Americans at the pump. Pretty smart eh!

Sounds similar of what the U.S. did in the Middle East, we located the oil & even built all of the oil rigs....

[ABetterDetroit]

Well over here in Canada we have a plan. We let American oil companies dig out OUR oil, send it to the U.S. for refining, then we buy it back at world prices in U.S. dollars and pay 50% more than Americans at the pump. Pretty smart eh!

I don't know so that's why I'm asking: What pays for all those nice roads, trains and buses you have all over Toronto? Is there a tax on fuel that might be higher than stateside?

[msamslex]

I just got gas yesterday. Should have sacrificed and spent a bit more. Will be staying parked even more than I do now.

[Honky Tonk]

My thumb hurts. When I walk in to work today, I'm going to tell them I'll need to charge them 20% more to do my job. I'll keep everyone posted how that'll work out for me.